Fraud prevention month highlights investment scams

By MEDICINE HAT NEWS on March 19, 2024.

The Medicine Hat Police Service’s fraud prevention month focus is on sharing information on investment-style scams this week.

Police say investment scams can happen in person, over the phone, online or through then mail, and the intent is to get someone to invest money into an established industry, newly emerging sector or any other type of opportunity.

They say two of the more common versions are Ponzi and pyramid schemes.

Ponzi schemes are based on investments that don’t exist. They say investors are paid some of the money provided by later investors until there are no new investors and the scheme ends.

Pyramid schemes often request investors to get other investors interested and get them to invest as well, keeping the scheme going for a longer period of time.

“Remember that when things seem too good to be true, they likely are,” MHPS’ release says.

Police also caution residents from investing in mass marketing scams where they are convinced to invest in crypto currency. With online currencies unregulated by banks and governments, police caution that once money has transferred hands the ability for a successful criminal investigation is low.

Their tips for staying safe from investment scams are:

– Ask questions, if you weren’t satisfied with the answers, keep asking.

– Always be suspicious of high-pressure sales tactics.

– Investment decisions take time and consideration, don’t let someone rush you.

– Appearances and charisma are assistants to fraudsters. Pay attention to the situation and not as much as the person selling it.

– Always seek advice from professionals. Whether it be a lawyer, an accountant or investment professionals.

– Never accept a verbal agreement, always get it in writing and keep it handy.

Visit the Alberta Securities Commission Investor Alerts to stay up to date on the latest investor alerts and notices.

To legally sell securities in Alberta, an individual must be registered with ASC,(with very limited exceptions).